Speaking at the Vietnam Business Forum last week, a senior EU official said that Vietnam’s annual GDP could see an additional 15% boost if it reached a free trade agreement with the EU by the end of the year.
The statement was made by Tomaso Andreatta, a representative of the European Business Association in Vietnam (EuroCham) in a discussion about the opportunities, challenges and socio-economic impacts of the Trans-Pacific Partnership agreement (TPP) and Vietnam-EU Free Trade Agreement (FTA).
He added that if the agreement is signed, “real wages of skilled laborers may increase by up to 12 percent, real salaries of common workers may rise by 13 percent and exports may go up by nearly 35 percent,” reported Tuoi Tre.
This growth hinges on Vietnam’s ability to “make a comprehensive commitment to the terms of international trade and ensure the effective enforcement of these provisions,” Andreatta continued.
EuroCham suggested that to reach this target, restrictions on foreign ownership, especially in the country’s banking sector, which is currently limited to 49%, should be eased or removed.
So far, Vietnam and the EU have signed seven bilateral FTA negotiations and, according to the VCCI in HCMC, the EU has surpassed the U.S. as the country’s largest export partner.
Bilateral trade turnover between the 2 countries reached US$33.6 billion in 2013, up 16 percent from the previous year.
According to World Bank statistics, if Vietnam reached a 21% GDP growth rate, it would be by far the strongest in the world.
Given the loftiness of this figure, we wouldn’t be surprised if this was a bit of marketing on the part of EuroCham to push the trade agreement forward.
[Tuoi Tre // Photo via Images Money]
